Funding models of community colleges in 10 Midwest states

Community College Review, Winter, 2004 by Carol Piper Kenton, John H. Schuh, Mary E. Huba, Mack C. Shelley, II

Discussion

According to Brumbach and Villadsen (2002), "At its best, resource development in the community's college is a [sic] entrepreneurial operation that melds public and private resources, knowledge of college needs and operations, effective solution development and a visionary approach .... " (p. 85). The variety of funding patterns supports the concept of state individuality (Medsker & Tillery, 1971; Morsch, 1971; Wattenbarger & Stepp, 1978); that is, states go about funding community college operations in different ways, presumably consistent with the goals and culture of each state. In the states that are included in this study, four funding models emerged, and all of them seemed to be successful using Bowen's laws of higher education costs as a framework. Bowen (1980/1996) asserted, "Each institutions raises all the money it can," and "each institution spends all it raises" (p. 123). In the case of the four models, each succeeded in raising more money than the rate of inflation, thereby enabling institutions to spend at a rate exceeding inflation. Overall, the funding patterns for the community colleges included in this study are consistent with resource dependency theory. In states where the level of funding from one source is low (e.g., local appropriations), community colleges look to other sources to sustain their revenue stream within the context of their mission and philosophy.

For example, those states that advocate the importance of the unique "open door" mission of the public community college most likely will rely less heavily on student tuition and fees in order to encourage access (Griffith & Connor, 1994; Vaughan, 2000). Five Midwest states studied by Katsinas, Johnson, and Snider (1999) illustrate this point. In their study, the states with the highest participation rates (Illinois and Michigan), as defined by the percentage of the population enrolled in community colleges, had the lowest tuition and fee charges. In Indiana, Ohio, and Wisconsin, just the opposite was true; that is, participation rates were smaller and tuition and fee charges were higher.

Those states in which the mission of the community college is to meet the needs of the immediate local community may develop a funding pattern that emphasizes local appropriations (Fields, 1962). When a state-level governing body attempts to treat all community colleges equally, the funding pattern probably will depend heavily on state appropriations and state grants (Medsker & Tillery, 1971; Wattenbarger & Starues, 1976). When the constituents within a state believe that the individual, the local community, and the state in general all receive nearly equal benefits from higher education, the funding pattern may rely on equal proportions of funding from each of these funding sources.

To determine if any model provided consistent or increasing revenue dollars during the period of the study, current funds revenue for 1990 was compared with current funds revenue for 2000. This comparison involved an adjustment for inflation, as represented by the change in the Higher Education Price Index (HEPI) over the decade. "The HEPI is based on the prices (salaries) of faculty and of administrators and other professional service personnel; clerical, technical, service, and other nonprofessional personnel; contracted services such as data processing, communication, transportation, supplies and materials, and equipment; library acquisitions; and utilities" (cited in University of San Francisco, n.d., para. 4).